BlueCross rates soar 26 percent

FACTBOX

A 26 percent rate increase by Oregon's largest health
insurer underscores the need to overhaul the state's
health system and bring costs under control, health care
reform advocates and business leaders said Tuesday.

Regence BlueCross BlueShield of Oregon raised rates Tuesday
by 26 percent for individual insurance plans due for annual
renewal and by 16 percent for small group plans, which are
mostly for small businesses with 50 employees or fewer.

"This is one more example of a broken health care
system that we all have a responsibility for fixing,"
said Maribeth Healey, executive director of Oregonians for
Health Security. She and 17 other health reform and business
leaders gathered for a news conference in downtown Portland
outside the building known as the Black Box, which houses
some of the BlueCross offices.

Portland resident Karen Kirsch filed a challenge of
BlueCross' 26 percent rate increase with the state, and
Department of Consumer and Business Services officials said
they will schedule a hearing to determine whether the
increase is justified.

Up on the 12th floor of the Black Box, Dr. Bart McMullan,
president of Regence BlueCross, agreed the health care
system was on an unsustainable path and needs to be
transformed. The fact is, he said, his company lost $21
million to $23 million last year on its individual health
care plans.

"The last thing we want to do is raise premiums for
individuals by 26 percent," said McMullan. "We are
sorry we have to do it. We want to work on the causes so we
don't have to do this over and over."

He and Healey have worked on the same subcommittee of the
Oregon Health Fund Board, a panel charged with presenting
the 2009 Legislature with a plan for rebuilding the Oregon
health system.

Regence BlueCross insures about 89,000 of the 246,000
Oregonians with individual plans and about 37,000 of the
252,000 residents in small group plans.

More than 1 million Oregonians are insured by large
employers. However, the state regulates only rate increases
for individuals and small groups said Cory Streisinger, who
heads the agency that includes the Insurance Division.

"Our responsibility is to look out for the interests of
Oregonians in making sure that rates are fair in relation to
the benefits they receive, but we also have to be sure that
insurance companies can stay in business," she said.
"A 26 percent increase is a very substantial increase.
We as a state and a society need to get a handle on health
care costs."

Most of Oregon's largest insurers have been raising
rates by double digits annually over the last two years.

The Kaiser Foundation Health Plan of the Northwest raised
its individual rate by nearly 13 percent on Oct. 1, 2006,
and by 7 percent a year later. PacificSource Health Plan
raised its individual plan rate by nearly 17 percent on Jan.
1.

Regence BlueCross BlueShield also raised its rate by 12
percent for individuals a year ago, but it dropped its
charge by 15 percent for that group in 2006.

The cost of its premiums vary widely according to age,
deduction amount and whether plans are for individuals or
families.

With the 26 percent increase Tuesday, monthly individual
rates for premiums with a $500 deductible vary from $88 for
children to $559 for adults ages 60 to 64. Family plans
range from $359 per month to $1,230 depending on the age of
the eldest member.

The premiums for all groups have been climbing faster than
the cost of living over the last eight years.

Average monthly family premiums in Oregon, for example,
increased by 64 percent, from $555 to $908, between 2000 and
2005.

Christine Chin Ryan, president of Synergy Consulting Inc.
and a leader with Oregon Small Business for Responsible
Leadership, said she has seen insurance premiums for her six
employees climb by double digits in all but one of the last
seven years. She now pays about $1,200 a month to provide
family coverage for one employee.

Most small businesses want to provide health care coverage
for their employees, she said, but they cannot afford the
high costs.

Teri Mills of Portland, a registered nurse and community
college instructor, said she's concerned about how
higher insurance costs will affect her patients and students
who are being clobbered by other rising costs of living such
as for fuel, food and tuition.

BlueCross rates soar 26 percent

FACTBOX

A 26 percent rate increase by Oregon's largest health
insurer underscores the need to overhaul the state's
health system and bring costs under control, health care
reform advocates and business leaders said Tuesday.

Regence BlueCross BlueShield of Oregon raised rates Tuesday
by 26 percent for individual insurance plans due for annual
renewal and by 16 percent for small group plans, which are
mostly for small businesses with 50 employees or fewer.

"This is one more example of a broken health care
system that we all have a responsibility for fixing,"
said Maribeth Healey, executive director of Oregonians for
Health Security. She and 17 other health reform and business
leaders gathered for a news conference in downtown Portland
outside the building known as the Black Box, which houses
some of the BlueCross offices.

Portland resident Karen Kirsch filed a challenge of
BlueCross' 26 percent rate increase with the state, and
Department of Consumer and Business Services officials said
they will schedule a hearing to determine whether the
increase is justified.

Up on the 12th floor of the Black Box, Dr. Bart McMullan,
president of Regence BlueCross, agreed the health care
system was on an unsustainable path and needs to be
transformed. The fact is, he said, his company lost $21
million to $23 million last year on its individual health
care plans.

"The last thing we want to do is raise premiums for
individuals by 26 percent," said McMullan. "We are
sorry we have to do it. We want to work on the causes so we
don't have to do this over and over."

He and Healey have worked on the same subcommittee of the
Oregon Health Fund Board, a panel charged with presenting
the 2009 Legislature with a plan for rebuilding the Oregon
health system.

Regence BlueCross insures about 89,000 of the 246,000
Oregonians with individual plans and about 37,000 of the
252,000 residents in small group plans.

More than 1 million Oregonians are insured by large
employers. However, the state regulates only rate increases
for individuals and small groups said Cory Streisinger, who
heads the agency that includes the Insurance Division.

"Our responsibility is to look out for the interests of
Oregonians in making sure that rates are fair in relation to
the benefits they receive, but we also have to be sure that
insurance companies can stay in business," she said.
"A 26 percent increase is a very substantial increase.
We as a state and a society need to get a handle on health
care costs."

Most of Oregon's largest insurers have been raising
rates by double digits annually over the last two years.

The Kaiser Foundation Health Plan of the Northwest raised
its individual rate by nearly 13 percent on Oct. 1, 2006,
and by 7 percent a year later. PacificSource Health Plan
raised its individual plan rate by nearly 17 percent on Jan.
1.

Regence BlueCross BlueShield also raised its rate by 12
percent for individuals a year ago, but it dropped its
charge by 15 percent for that group in 2006.

The cost of its premiums vary widely according to age,
deduction amount and whether plans are for individuals or
families.

With the 26 percent increase Tuesday, monthly individual
rates for premiums with a $500 deductible vary from $88 for
children to $559 for adults ages 60 to 64. Family plans
range from $359 per month to $1,230 depending on the age of
the eldest member.

The premiums for all groups have been climbing faster than
the cost of living over the last eight years.

Average monthly family premiums in Oregon, for example,
increased by 64 percent, from $555 to $908, between 2000 and
2005.

Christine Chin Ryan, president of Synergy Consulting Inc.
and a leader with Oregon Small Business for Responsible
Leadership, said she has seen insurance premiums for her six
employees climb by double digits in all but one of the last
seven years. She now pays about $1,200 a month to provide
family coverage for one employee.

Most small businesses want to provide health care coverage
for their employees, she said, but they cannot afford the
high costs.

Teri Mills of Portland, a registered nurse and community
college instructor, said she's concerned about how
higher insurance costs will affect her patients and students
who are being clobbered by other rising costs of living such
as for fuel, food and tuition.